Joseph N. DiStefano

POSTED: Friday, February 24, 2012, 11:42 AM

The $24 billion, ultimately taxpayer-funded PA State Employees' Retirement System has done its annual data dump in Harrisburg, which gives us a lot of information about the increasingly unbalanced (revised) pension fund for 227,000 working and retired Pennsylvanians:

SERS is increasingly dependent on direct state payments and indirect employee contributions, because investment profits have declined over the years. The average state pension is around $24,500/year; though we know some older prison guards and secretaries who retired decades ago get a fraction of that, while recently superannuated ex-college administrators, judges and state reps get much fatter packages. One-page summary here.

Much more information about all the money spent on private Pennsylvania and Wall Street money managers and how much profit that didn't produce can be read in the annual SERS Budget Binder here.

Joseph N. DiStefano

POSTED: Friday, February 24, 2012, 10:15 AM

President Obama's corporate tax reform proposals win mostly positive marks from the conservative Manhattan Institute, because he offers "lower rates from a broader base" of business taxpayers, writes senior fellow Josh Barro. Still, Manhattan questions Obama's preference for manufacturing and renewable energy over other businesses, in this short report.

Highlights: Obama would:

- Cut the base corporate tax rate to 28%, from 35%. That "would make us more competitive; lost revenue can be offset by broadening the corporate tax base" to curb abuse of lower-taxed, small business-focused C-corporations and S-corporations by big companies.

Joseph N. DiStefano

POSTED: Friday, February 24, 2012, 9:42 AM

South Jersey stank for miles around PFB Energy's Paulsboro oil refinery yesterday after a leak yesterday wastes 6.6 million gallons of oil, about a day's production. NJ DEP tells Gloucester County Times and local Patch.com the spill hasn't reached the Delaware, nor will the smell make you sick, so move along, nothing to see here, the experts have everything under control.

Joseph N. DiStefano

POSTED: Friday, February 24, 2012, 9:33 AM

As Pennsylvania prepares another $55 million fix-up of its ridiculously ornate state capitol complex, Gov. Corbett hopes to save $690,000 a year by killing the seven-person Public Employess' Retirement Commission, which under James McAneny has been one of the few independent bodies able and willing to challenge Pennsylvania state and local governments' relentless subprime addiction to of awarding legislators and other public workers pensions that they are unwilling to adequately finance, PA Independent reports here.

Corbett would transfer PERC's powers - which, because of General Assembly inaction, have been sadly limited to describing the disaster of pension under-funding, instead of effectively doing anything about it - to the state Department of Community and Economic Development, which Mark Schwartz, former state bond lawyer turned municipal finance critic, has called a "rubber stamp" for approving stupid political spending project using borrowed money taxpayers repay for decades after the politicians and contractors responsible have comfortably retired.

The result has been an explosion in taxpayer liability to pay public pensions, as SERS' and PSERS' annual trip this week to the Capitol to simultaneously defend their expensive, underperforming investment programs and warn that they need a lot more money have made clear, again.

Joseph N. DiStefano

Home prices in Pennsylvania and New Jersey fell more than 1% on average during the fourth quarter, a bigger drop than in the U.S. as a whole, the Federal Reserve Bank of Philadelphia reports here.

The Philadelphia-area drop was 2.5%. For all of 2011, home prices fell faster in Pennsylvania, New Jersey and Delaware than nationally, though Delaware prices, which have fallen more than in the other states in the late recession, started to rise in the last three months of the year.

Joseph N. DiStefano

POSTED: Friday, February 24, 2012, 4:31 PM

City Controller Alan Butkovitz tells me the newly-completed annual fiduciary report for Philadelphia's beleagured pension plan for city workers shows a "surprise" improvement in the funded ratio - assets are now 50% of liabilities (corrected), up from 47%, back above the state's danger threshhold - moving the opposite direction from the increasingly cash-strapped Pennsylvania state pension systems.

How's that possible? Butkovitz cites slower-than-expected city payroll growth (just 1% last year, vs. expected 3.5%), a (possibly connected) decline in the cost of future benefits, and "outstanding" investment returns, due to the stock market recovery, of 19.4%.

I'll have to see the report to know more, but any release in pressure on the need to fund future retirements is good news for city taxpayers, workers, services.

Joseph N. DiStefano

POSTED: Thursday, February 23, 2012, 3:42 PM

The US Treasury will funnel $50 million in federal New Markets tax break credits to the Philadelphia Industrial Development Corp.'s Regional Development Corp. to stimulate private investment in city development projects, the Treasury Department said today. PIDC is a joint venture of the city and the regional chamber of commerce, a private business group.

Treasury also allocated $70 million to PNC Community Partners Inc. and $42 million to the Reinvestment Fund (TRF), both of which are active subsidizing development and business projects in Philadelphia and other markets.

UPDATE: US Rep. Chaka Fattah, D-Phila, supported the PIDC and TRF applications. As Mayor Nutter noted in announcing the deal,

PIDC got a previous $60 million award under the program back in 2007; TRF got $75 million in 2006, again in 2008, and $90 million in 2010. The tax grants through TRF subsidized, among other developments, the ShopRite in Southwest Philadelphia on Island Ave., developer Bart Blatstein's Avenue North project near Temple University, the Hub development near the University of Pennsylvania campus, the Progress Plaza updates in North Philadelphia, and a project on Hancock Square. PIDC used the money for projects like Homewood Suites' Philadelphia hotel, says Fattah spokesman Ron Goldwyn.

PhillyDeals posts raw drafts and updates of Joseph N. DiStefano's columns and stories about Philly-area finance, investment, commercial real estate, tech, hiring and public spending, which he's been writing since 1989, mostly for the Philadelphia Inquirer.

DiStefano studied economics, history and a little engineering at Penn,
taught writing at St. Joe's, and has written the book Comcasted, more
than a thousand columns, and thousands of articles, and raised six
children with his wife, who is a saint.